Economists and comedians deliver some serious entertainment on economic woes
PAUL MCCULLEY brings a cool, Californian vibe to the Set Theatre in Kilkenny. He is 55, wealthy and retired from managing tens of billions of other people’s money for bond king Pimco. Economist Paul Krugman regards him as one of the finest economic brains in America.
A full house beholds the head of bouncy, lustrous, shoulder-length grey hair (the kind that takes serious maintenance) and tasselled snakeskin loafers and wonders in its sad, penny-pinching shame, how it must feel to be McCulley.
He knows what they’re thinking: “You are rich when you quit looking at the right-hand side of the menus.”
Still, he once baulked at paying $14 for a room service pot of coffee, he says, ergo he is “not yet rich”.
“Yeah, right,” sighs a voice a few rows back.
McCulley is the brilliant, quirky, often contradictory essence of Kilkenomics, David McWilliams’s annual, seriously entertaining economics fest. So this retired capitalist, money safely stashed, is here to tell us that there are limits to greed; that it’s time to apply the 12-step programme to private sector debt (Step 4: thorough and fearless self-examination); that democracy and capitalism are in “an unholy marriage of incompatibility”; that capitalism in Ireland is dead and Irish democracy a widow – “and now you have your ex-partner’s mother living in your cellar”. Her name is Creditor.
It’s a tour de force.
Prowling back and forth, stroking his beard and flicking his fabulous hair, declaiming like a southern Baptist preacher, he says democracy is inherently a socialist system, while there is nothing egalitarian about capitalism. “But the tie that binds them is called the rule of law. While capitalists curse and bemoan government and politics, the one thing they have to have is an enforceable, credible rule of law.”
What capitalism brings is efficiency – too much of it in the past 20 to 30 years, he reckons.
In the US now, election decisions are being taken about the balance between democracy and efficiency. “It’s a matter of degree, which is why I’m reasonably optimistic about America”. But in Euroland there is a third dimension: national sovereignty.
“What’s going on here is whether sovereign states are willing to sacrifice their democratic sovereignty on the throne of capitalism. Does the creditor set the terms? That’s called austerity and punishment: capitalism.”
Allow that and the price will be one of “enduring anaemia, pneumonia. . . an enduring second-class citizenship wearing the cloak of shame. And the young will vote with their feet.”
His prescription? Simple. It’s all in Paul Simon’s 50 Ways to Leave Your Lover, he says.
“It is [the markets] who will come back to you! Get yourself free,” he booms. “But I don’t think this country has the testicular fortitude to sing Paul Simon.”
Under questioning, he concedes that Simon’s might be an extreme route to take. “We need a marriage counsellor here . . . What is untenable is trying to form a new relationship when the elephant of the too-big-to-fail debt is sitting in the bedroom.”
Keynes wrote all this in 1919, he says. You can’t get blood from a stone.
The most flamboyant defaulter of the 20th century was Germany, concludes McWilliams, winding it up in every sense with a mischievous grin.
If that wasn’t enough to fire up testicular fortitude, there were 25 other events with 30 contributors from across the world, many of them rather bemused that the euro was still staggering on.